Another day another whale that gets harpooned. Looks like JPM is having some risk management issues of the $2 billion variety. Meanwhile back at the charts there has been a huge amount of put option buying which can be viewed as contrarian bullish. I’ve put an orange line at the current level and put blue boxes around past instances so we can see how the market has reacted in the past when the put/call ratio has been this high. In the short-term we could see some appreciation from here, but there is still a lot of headwinds that could cut the advance short.
However, I’m still noticing an increase in selling pressure and a shift out of high-beta stocks and sectors and into places like healthcare and utilities which suggests traders are still not ready to jack up the adrenaline just yet (well except at JPMorgan apparently).
Gas prices have come down nicely and filled the gap to $3.00 I referenced back on 5/7. The indicators I was watching for an oversold condition have been hit and with that we are seeing a slight advance now in spot gasoline prices. Here’s an updated chart:
Disclaimer: Everything in this post is meant for educational and entertainment purposes only. Do not construe anything written in this post or blog as a recommendation, advice, or an offer to buy or sell any securities. I or my affiliates may hold positions in securities mentioned in the blog. Please see my Disclosure page for full disclaimer.
